Telegraph loses Galloway libel appeal

The Daily Telegraph has lost its appeal against a £150,000 libel award to the MP and Big Brother contestant George Galloway.

The court of appeal today upheld a high court judgment in 2004 that the Telegraph libelled Mr Galloway in an article alleging that he received money from former Iraqi dictator Saddam Hussein's regime.

The Telegraph launched an appeal after it was ordered to pay £1.2m legal costs and £150,000 in damages.

The appeal court today rejected the Telegraph's defence that it was in the public interest to publish documents containing the allegations, saying the paper had not merely reported the contents of the documents, but had "both adopted and embellished them".

"It was alleging that Mr Galloway took money from the Iraqi oil-for-food programme for personal gain. That was not a mere repeat of the documents, which in our view did not, or did not clearly, make such an allegation," the three appeal court judges ruled.

"We agree with the judge that although there were some references to allegations, the thrust of the coverage was that the Daily Telegraph was saying that Mr Galloway took money to line his own pocket."

The claim was based on documents discovered by the newspaper's then Baghdad correspondent, David Blair, in the burnt out ruins of Iraq's former foreign ministry.

The MP has consistently denied receiving subsidies from Baghdad.

The paper argued that publication of the documents could be defended on the grounds of qualified privilege - that the story was of overriding public interest and had been published in good faith.

But the judge, Mr Justice Eady, ruled that the Telegraph did not qualify for this type of defence because it had failed to give Mr Galloway sufficient time to respond to the allegations.

He also criticised the presentation of the story, saying the paper had not neutrally reported the contents of the documents, but "embraced them with relish".

At last year's appeal hearing the Telegraph argued that the original verdict had not differentiated between fact and comment.

James Price QC, for the paper, said Mr Justice Eady had compensated Mr Galloway for the effect on his reputation and feelings of publication of the documents and not merely for the effects of 'spin' put upon the documents by the coverage.

The judges refused the newspaper permission to appeal to the House of Lords although it can petition the Lords direct.

Mr Price, for the Telegraph, said the case was "right at the leading edge" of the debate over freedom of expression as it involved an elected MP allegedly taking money from a hostile foreign government.

Richard Rampton QC, for Mr Galloway, said permission to appeal should be refused by the appeal judges as theirs was "one of the most unequivocally emphatic judgments" in this field of the law that he had ever come across. The trial judge had been upheld on every single point, he said.

The judges ordered the Telegraph to pay Mr Galloway's costs of the appeal, estimated at around £140,000, and to make an interim payment in respect of that sum of £60,000.

The newspaper will also have to pay the £150,000 damages and £200,000 as an interim payment on account of Mr Galloway's costs of the action.

The order for payment of all the sums was stayed pending disposal of the newspaper's application for permission to appeal to the Lords, and pending determination of that appeal if it gets the go-ahead.

If the Lords refuse to hear an appeal, the newspaper must pay Mr Galloway the sums due within 14 days.

Mr Galloway, who is currently appearing on the Channel 4 reality TV show Celebrity Big Brother, was elected MP for Bethnal Green at the last general election. He stood against Labour's Oona King after being expelled from the party for comments he made about the Iraq war.